Last week’s Q3 national accounts revealed that Australia’s per capita GDP has declined for seven consecutive quarters, declining 2.1% since the Albanese government formed government in June 2022.
The decline in Australia’s per capita GDP has been driven by household consumption, which has fallen by 2.5% in per capita terms since Labor took office.
The NAB Business Survey, released on Tuesday, suggests that the Australian economy remains in a per capita recession.
As Justin Fabo at Antipodean Macro shows below, business conditions, including profitability, declined in November and are tracking below the long-run average.
Retailer business conditions are especially weak.
Australian firms also reported a dip in forward orders in November, consistent with domestic demand growth remaining tepid in Q4.
The decline in profitability also points to lower employment.
The good news is that the decline in labour costs reported in the NAB Business Survey points to a further moderation in services inflation.
Indeed, Justin Fabo’s preliminary nowcast of Q3 trimmed mean inflation has fallen to just 0.6% for the quarter.
